Dukascopy Bank Team
Dukascopy Bank SA
GBP/CAD 4H Chart: Channel Up
Comment: Despite a strong sell-off at the beginning of May that interrupted Sterling’s recovery, GBP/CAD returned to trading between the boundaries of the bullish channel. Accordingly, the outlook is positive. The exchange rate is expected to rebound from 1.90 to 1.93 over the next few days. In the longer-term perspective, the currency pair may well rise up to 1.9560, where the monthly R3 merges with the February high. On the other hand, if 1.90 fails to underpin the pair, there is likely to be a dip down to 1.8865 (weekly S1 and monthly R1), but we should not rule out a deeper decline, down to the long-term SMA or monthly PP just above 1.85.
USD/CHF 4H Chart: Channel Down
Comment: Considering that USD/CHF has been trading in a well-defined bearish channel since early March, the bias is to the downside. The currency pair is supposed to stay beneath 0.9440, where resistance is implied by the falling line and the 200-period SMA. The first near-term target is the monthly S1 at 0.9142, followed by the May low at 0.9074. As soon as the price reaches 0.8948 however, we should expect an upward correction. This scenario will get invalidated if USD/CHF closes above 0.95. In this case the US Dollar will likely move towards the April high at 0.9864. In the meantime, most of the SWFX traders, namely 73% of them, are currently long the Greenback.
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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